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- Research date
- Sep 21, 2026Use the dated article and cited sources for the definition, examples, and stated limitations.
- Operating-model context
- 16 connected conceptsPart of the reviewed REIT Leasing and Capital Deployment; issuer definitions remain distinct where disclosed.
- Company examples
- 1 reviewed companyRelationships reflect supported examples, not a normalized cross-company KPI ranking.
REIT economic occupancy measures the share of available space under leases for which tenants are contractually obligated to make lease-related payments.
Alexander & Baldwin distinguishes economic occupancy from leased occupancy and physical occupancy.
The three occupancy states
A space can move through three different milestones:
- the lease is signed;
- the tenant receives physical access; and
- contractual rent payments begin.
These milestones can occur on different dates.
Why economic occupancy matters
Economic occupancy can be a closer measure of currently monetized space than leased occupancy.
A widening gap between leased and economic occupancy can indicate future rent commencement, but it can also reflect construction and delivery timing.
Source:
Economic occupancy is an issuer-defined monetization measure. It should not be assumed to equal generic physical occupancy.
Part of the REIT Leasing and Capital Deployment
Connect lease duration, occupancy states, rent mark-to-market, tenant quality and concentration, development returns, and acquisition or disposition pricing to understand commercial real estate cash-flow durability and external growth.
How the model fits together
- Lease rollover and rent mark-to-market: Weighted average lease term and lease-expiration concentration frame when rent rolls, while tenant retention, cash leasing spreads, GAAP or net-effective leasing spreads, and net-effective rent per square foot show how much space renews and at what economics.
- Occupancy, tenant quality, and contractual rent base: Annualized base rent provides the contractual rent weighting base, leased and economic occupancy separate signed space from rent-paying space, and investment-grade mix, top-tenant concentration, and contractual rent growth describe the credit, concentration, and embedded growth profile of that rent stream.
- Development and asset recycling: Development pipeline shows future capital commitments, development yield relates expected stabilized NOI to development cost, and acquisition and disposition cap rates frame the going-in yield bought versus the property yield sold. Issuer definitions differ, so these measures support capital-allocation analysis rather than a standardized arbitrage formula.
See It in Company Research
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